The 420 Trade Plan

Everyone who has opened up an options trading account scours the internet for trade ideas, intraday trading tips, the most profitable option strategy or just stock market trading strategies in general in their pursuit to figure out how to make money in options trading. While there are quite a few day trading secrets, all of them sings the same tune in their head:

“I wanna get (my account) high, so high… I wanna get (my account) high, so high…”

You can go out and get all the intraday trading tips you can handle and try your best to figure out how to make money in options trading with a dozen or so day trading secrets, but , the most profitable option strategy you will ever has is two words, 5 letters:

A PLAN

To make things simple and enjoyable at the same time, raise your hand if you like to make money. Now raise your hand if you like to smoke weed (or wish you could).

Well, everyone by now knows that 420 is synonymous with smoking weed, whether it’s 4:20 AM, 4:20 PM, April 20th, any #:20 (cause it’s 4:20 somewhere) or you can’t wait for 2020 when it will be 4/20 for a whole month. Well thanks to a 1-on-1 call with one of the 32Trades members this weekend, a couple of comments with DaGrinder @Ryan, a spark of genius ignited and I’ve got another “simple, stupid” trading plan which will be very beneficial to those beginners (or limited funds traders) looking to build up an account while gaining the discipline.

Without a plan to exit, you can’t have a plan to enter (that’s how babies are made). Without the earned discipline a trader needs to gain from experience, you will blow up accounts enough times that you simply won’t last long enough to take the free money the market is begging to roll up for you and let you toke for free for the rest of your life.

The 420 Trade Plan

We alert and trade some spectacular picks which typically double, triple, but sometimes you get those insane 1,000%, 2,000%, even had a couple of +10,000% trade alerts which are the cocaine of this game – the insane rush that gets people hooked to options trading. Those are awesome no doubt, but they are also corrupt to the extent that new traders and those with smaller accounts think it can happen more often than it does and the risks taken wind up forcing a trader to either shut it all down or refund the account since they blew it up.

Well how’s this look to you:

$400 20%

Exactly! Now that you have said in your head “that’s pathetic,” let me break it down for you in a way that is gonna spark a light bulb in your head so bright you’re gonna light up like star as you reach for the sky.

You have 225 trading session in a typical year

You have 12 months in a year

You have 18.75 trading sessions per month (ok, so let’s make it 18)

Ok, so you have $400 to trade with and you want to become a professional options trader, supplement your income, make $100,000 by this date which you have forced in your head is a deadline for something which needs to be done. Whatever your ambition for trading options, here’s the simple math of the 420 Trading Plan:

$400 in the trade for 20% profit: $80

18 trading sessions in a month

18 x $80 = $1,440

So, you took your $400, traded only that $400 each of the 18 trading sessions and only looked to make a 20% profit after fees and commissions and now you did this:

Your account is now worth $1,840 (your $400 plus the $1,440 you made)

You earned some discipline by limiting your risk and taking planned exits

You are going into month 2 with $1,840

Now, you’re into the next month, again one with 18.75 trading sessions (let’s just say 18 to keep it simple) and you have an account now that has grown 360% in the course of a month and you’ve been disciplined to already have planned entry amounts to trade with and a planned exit target (lotta fukin and’s in that sentence). Well now let’s go into month 2 with the $1,840 to trade with and see where we go:

$1,840 in the trade for 20% profit: $368

18 trading sessions in a month

18 x $368 = $6,624

Here’s 4 Months of using this 420 Trade Plan

Trade Amount

20%

18 Sessions Total

Month 1

$400

$80

$1,440

Month 2

$1,840

$368

$6,624

Month 3

$7,024

$1,405

$25,286

Month 4

$25,686

$5,137

$92,471

Liars Can Figure

But figures don’t lie and that right there is 4 months of using the 20% trade rule daily for your exit without compounding your trades like you would be doing with the 32Trades or 50Trades Plan. With the first month of doing $400 trades for 18 sessions, you have a limited amount of money on the table which allows you to build up the discipline you need to sustain a carreer in this game AND you have the predetermined exit plan right in front of your face.

Now you are already saying that you aren’t going to see 20% everyday and I challenge you to that discussion with two rebuttals to it:

We see triple-digit trades we focus on, sometimes quadruple-digit winners

With just 20% as a target, you don’t need to be in before the trade is ready, just be able to jump in and ride some of the middle of it

Look man, getting high everyday (I did it for 15 years) is great – ain’t nothing wrong with it, but when you need to step off, you can always just go out and start getting dime bags. Check it out, after say month 2, you don’t want to 420 anymore and you want to just take your $7,024 (your $400 and the $6,624 the market gave you) and get two dime bags every other day:

2 $3,000 trades every other session for 10%

Do that 9 times a month and you just got given another $5,400 by cutting your getting high time in half and how big of a bag you’re scoring. Decide to quit 420’ing after 3 months and cut yourself down to just 2 nickel bag trades a week: you’re talking about $1,250 on each 5%trade then.

So toke on this concept if you are in desperate need of an options trading strategy that fits your financial/time ability situation and I am willing to bet this will get you so high that you were gonna clean your room, but you got high; you were gonna go to work, but you got high; decided not to go to work, because you got high. Getting high is well worth it so 420 Daily and grow that account.